Gold Resource Corp (NYSE MKT:GORO) reported Thursday its preliminary production results for the second quarter, maintaining its full year outlook, with its shares rising in morning trade.
The U.S.-based gold producer with operations in Oaxaca, Mexico, reported production of about 20,500 ounces of precious metal gold equivalent for the three months to June 30. This compares with 14,488 ounces of gold equivalent in the same period last year.
It stood by its outlook for the full year, for output of between 80,000 to 100,000 ounces of gold equivalent.
“We are very pleased with our Oaxaca mine and mill management teams who have achieved preliminary production results of 20,500 ounces for the quarter in the midst of the Aguila mill expansion and construction,” said president Jason Reid in the release Thursday.
The planned expansion of the Aguila mill to a nominal 1,500 tonnes per day progressed well during the quarter, according to the company's statement, with the target to complete the project by year-end.
“It is our goal to keep mill operations going through the majority of the construction phase with minimal shutdown days for equipment installation," continued Reid. "Our ultimate yearly production will be dictated, in part, by our ability to limit mill shutdowns during construction.
"Though we are on track to achieve our targeted year-end production goals, this could change depending on the balance of mill construction,” he added.
The president further cautioned that with metal prices dropping dramatically, the gold to silver ratio is working against its gold equivalent production totals, making it more difficult to achieve its targeted production range.
"It is a credit to our team, led by our Chief Operating Officer Mr. Rick Irvine and General Manager Mr. Jesus Rivera, that we not only overcame the challenges of mill construction during the quarter, but compensated for the dramatic drop in the gold to silver ratio and still produced approximately 20,500 ounces precious metal gold equivalent for the quarter, keeping us on track for year-end production targets," said Reid.
The company, which began commercial output from El Aguila in July of 2010, has returned more than $85 million to shareholders in monthly dividends since it declared commercial production three years ago. It also offers shareholders the option to convert their cash dividends into physical gold and silver.
Shares of Gold Resource rose 8 cents on Thursday morning, to trade at $7.67 as of 11:30am ET.
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